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Digital Technologies are bound to change the way shipping companies operate, says the head of Setel Hellas

New technologies like cloud-based solutions, blockchain, the Internet of Things and the Digitization of business are slowly taking shape and are bound to transform the “modus operandi” of the shipping industry. In its everlasting quest of chasing margins and boosting competitiveness and efficiency, new digital tools are beginning to change old business models throughout the maritime industry. As such, new business opportunites arise. Hellenic Shipping News Worldwide (www.hellenicshippingnews.com) held an exclusive interview with Mr. George M. Marinakis, CEO of Setel Hellas, to discuss the shifting landscape.

Shipowners, Operators and industry Stakeholders begin to embrace the use of modern technologies to identify areas for optimization. What technology do you consider as the “magic of transformation” which takes organizations from ordinary to extraordinary?

It’s without doubt that rapidly developing maritime digital technologies, are transforming the way the assets at sea are managed. Innovations such as the cloud-based solutions and industrial internet of things (IoT), business analytics platforms and solutions for Business Intelligence (BI), fleet performance monitoring tools and truly predictive systems are showing emergent signs of improving vessels operations and performance. Today- in the maritime industry, shipowners and operators, makers of shipboard equipment, and associated regulatory bodies are embracing these disruptive technologies in order to gain fast and accurate insights across their operation and implement new strategies and business models based on those insights.

So- In my opinion, the most disruptive technology that is becoming more and more important in our industry, is the “Automatic Data Acquisition” technology. For me, this is the evolution of sensor-based data — This is the transformation from the days of “Terra incognita” data in a logbook to “Terra firma” smart data on an open platform for the full utilization and optimization of vessel – specific data.

By this time, many shipping companies are already collecting in several ways their own vessel operation data toward safer and more economical ship operation. Information from nautical systems is being also collected and accumulated in ECDIS and VDR. Engine manufactures like Wartsila, Terasaki, JRCS and so on, already equip their engines with sensors able to collect smart data. Thanks to IoT technology like SeeMBox-V, the acquisition, integration and use of multiple data related to various sources, are also feasible.

So- what is still need for the “magic of transformation”? What is needed is a “Digital Butler”: A common digital platform able to serve all stakeholders in the industry with non-disclosure shipping information. The whole maritime community – from owners and operators to manufactures and classification societies, could benefit from such an open platform in many different ways. Nevertheless, all this would not only require a novel platform and a powerful data center, but also the availability of large, skills based talent pool and well-established shipping companies with accumulated shipping expertise. I think the port of Piraeus has it all. It’s a perfect place to begin and further promoting the digital disruption in maritime industry.

Energy Efficiency and Performance Optimization is a key theme for the maritime industry. Why this is important and what makes it possible?

The challenge in the shipping industry is clear. If the market is volatile, charter rates are going down, and competition up, there is only one way to be sustainable and stay afloat: to control cost. In other words, to realize that even slight changes in operating conditions can lead to substantial changes in energy efficiency and performance optimization.

So, what kind of actions can the industry take to achieve its efficiency and performance goals?On the one hand – as we know; a comprehensive restructuring of a shipping company is often not practical. On the other hand, the conditions under which different companies operate differ significantly and consequently- rendering “blueprint” solutions, is almost impractical.

However, the company’s sustainability can be improved at least in certain areas …and, potential areas of efficiency improvements include: remote performance monitoring- making the vessel data available real-time and easy to understand, optimal routing according to the weather info, ship type and size, active speed and consumption optimisation as well as conditions based maintenance choices that look at the best economical lifetimes of vessel’s systems and subsystems.

Digital technologies are the key to executing this effectively, helping ship owners and operators make informed decisions about their assets. Thanks to Internet of Things, smart technologies- such as SetelHellas SeeMBox-V, are being used to continuously monitor the vessel. The date then analysed, helping technical engineers to identify specific actions that can improve the vessel’s operation and create a winning edge for their business.

Take the case of Samos Steamship, an operator of 28 vessels. The company has over the past 5 years, managed to reduce its Energy Efficiency Operating Index by 10% by adopting a series of solutions like optimized hull forms and remote performance monitoring technology like the latest SeeMBox-V. The company also fine-tunes its systems constantly to find new areas where it can improve efficiency. This holistic approach, says Mr. Marinakis, is essential if the new circumstances are to be met.

“Our commitment to creating a sustainable business environment through our maritime solutions and technology leadership to minimize environmental footprint and maximize efficiency, go hand in glove with our clients- like Samos Steamship’s, mission to promote environmentally responsible shipping, safety and efficiency through management excellence and continuous improvement effort” he explains.

Mr. George M. Marinakis, CEO of Setel Hellas

There have been many discussions this year about the Blockchain Technology. What is Blockchain and how the maritime Industry can take advantages of the Blockchain? 

Despite the recent wide adoption of disruptive technologies, maritime industry continues to operate more or less within a traditional business model and the day-to-day processes are many times obsolete.
Today, most of the ship to shore and vice versa transactions involve a large number of documents and forms, such as pre-arrival & arrival forms, departure notifications, notifications of dangerous or polluting goods, bunkering reports, crew list, sales & purchase contracts, charter party agreements, bills of lading and other reporting formalities correlated with the vessel, cargo, port as well as further authorized stakeholders and authorities. So, given the fact that all these specific documents are very important for the safety, absolutely necessary for the financial transactions that must be settled and- of course, critical for the harmless transport of the cargo, is vital to go through of all cross-border parties which are involved in trade and transport operation, for further verification and execution.

For example- take a look into the bills of lading process. The process starts from the shippers or forwarding agents at load port and go through all the traditional intermediaries- such as banks and other institutions, until they reach the final consignee. So, it is obvious that the process is time-consuming and frequently results in serious delays and unexpected additional charges for freight storage. Not to mention that the vessel can be arrive at the discharge port before the bills of lading…

Therefore- in an effort to simplify the time-consuming and sometimes costly processes, the maritime industry can be inspired by newer technological disruptions such as the bitcoin technology, namely – Blockchain and take serious advantages. “…and to clarify: while a lot of discussions has shifted from the bitcoin technology to blockchain technology, the two are totally interrelated.” Mr. Marinakis explains.

But what is Blockchain? At a high level- blockchain technology, is based on an open-source software which is totally decentralized and the management of all the transactions is taking place collectively by a network of computers. Now- for the management of all these transactions, the related blockchain applications use a continuously growing list of records- called blocks, which are linked and secured using consensus algorithms and cryptography, thereby creating a distributed and immutable chain or ledger that records all the transactions context; this is the “blockchain”.

Well, each of these blocks include a timestamp and a link to a previous block of the chain and the transaction is processed only after several confirmations of the network, in order to ensure that every transaction follows the rules of the network. Therefore, after the information is recorded in the block, the data cannot be altered unless the subsequent blocks are also changed and the network majority accepts the alteration. In this way, human’s interference in the blockchain is impossible and the system becomes totally secured by design.

In this respect, I think that it is easy to imagine that one of the biggest revolutions that the blockchain technology could bring in the maritime industry is the “smart contracts”. To name a few examples- let’s think about the charter-party contracts or the bill of lading contracts and why not, the Bunker Service Contracts or the Marine Insurance Contracts. The contract will be published by the Owner or the Charterer, the Bunker Supplier or the Insurer and the other party will negotiate directly via the blockchain network. How? By recording the contract’s terms and conditions on a shared database that runs a blockchain protocol, contracts could use that attributes to make themselves self-executing if certain terms and conditions between the involved parties are met. It is also important that, all the involved parties are able to validate the outcome instantly and seamlessly, without wasting precious time on further exchanges and- last but not least, without the thorny dealing with various intermediators.

Slowly but steadily, the concept is gaining huge momentum with many leading shipping firms -like Maersk, to allocate significant budgets in order to take advantages from Tech Ideas dedicated to blockchain technology. So, quick processing time and real-time updates, full transparency and accountability, increased security and greater privacy, cost saving and easier access to the market without the need of intermediators, are only some of the major advantages.

What is the biggest challenge which SetelHellas faces today?

We live in rapidly changing times, especially for businesses. We are entering the age of the Fourth Industrial Revolution- a technological transformation, which is shaping the future of key sectors creating new business models and opportunities. The biggest challenge for us is to manage these seismic changes in a way that promotes the long-term sustainability of SetelHellas business.
To achieve these objectives, we need to be out there and looking around for opportunities, we need to be able to objectively evaluate whether or not we need to evolve and take a different route in order to steer our ship in the right direction.

Nikos Roussanoglou, Hellenic Shipping News Worldwide

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